By Wallace L. Clapp, Jr., CPCU
Complete insurance for contractors constitutes a wide variety of coverages not originally perceived as needed by contractors a few years ago. Pollution exposures have complicated the picture because of various federal laws governing liabilities and cleanup of our environment by the Environmental Protection Agency.
Many contractors have also taken on design capabilities which introduces an element of professional liability to the client if the design as well as workmanship becomes subject to liability. To those contractors who advise or are consultants for cleanup of asbestos or other environmental wastes on properties they are working on there is also a pollution exposure.
Because there are many different types of contractors, every insurance agent has an opportunity to write contractors insurance programs. Not all are large general contractors doing heavy construction, requiring large complex insurance programs. Some are small artisan contractors or roofers that do single tasks in residences or small commercial buildings.
Agents who solicit contractors who are just starting out prosper when the contractors business begins to expand. Liability insurance and bonds are the first needs for the young contractor. As business grows, there is a greater need for workers compensation and property insurance for construction equipment.
Artisan contractors represent the greatest number of contractor prospects. A wide number of classes, including plumbers, electrical contractors, painting contractors, dry wall and plasterers, paper hangers, carpenters, ornamental iron workers, bricklayers and masons, tilers and floor covering contractors, work as artisans, usually on an independent basis or under subcontract of a general contractor. These artisans are mostly involved with residential property but also work as subs in larger risks and commercial buildings.
General contractors handle the bulk of heavy construction. They may be involved in building large commercial buildings, or offer a service but do not build. Examples of general and specialty contractors in this class include general contractors, demolition contractors, land graders, HVAC contractors, steel erectors, excavation contractors, bridge and tunnel construction, marine contractors, railroad construction, concrete construction, asphalt paving, street, road and highway construction, structural metal and fabrication work, scaffolding and hoisting and sprinkler contractors.
Contractors involved in environmental cleanup, such as asbestos abatement, lead abatement, petroleum tank removal, and environmental contractors represent a third group of prospects.
Markets
We have identified a number of markets for contractors insurance that have specific programs for roofers, artisan and general contractors and environmental specialists. While we realize that most contractors can purchase coverage to protect their needs through standard companies, sometimes certain classes of specialty contractors, artisans and some general contractors can be fit into special programs available in the specialty market. We are providing information to you that we have received about specialty markets in alphabetical order.
Arrowhead General Insurance Agency, Inc., 6055 Lusk Blvd., P.O. Box 85320, San Diego, CA 92186-5320; (619) 677-5214; fax (619) 677-5222; Web site: www.arrowhead.org (Andrew Barile, CPCU, president, commercial division). This managing general agency has introduced a program through its commercial division for artisan and service contractors offering general liability, inland marine and commercial auto insurance.
Over 50 classes are eligible for coverage under this program.
The maximum limits for general liability are $1 million/$2 million. Inland marine limits are $100,000 for scheduled equipment and $10,000 for unscheduled. Commercial auto limit is $1 million csl. The general liability, inland marine and commercial auto is written through the Clarendon Insurance Group (A-), and the stand-alone auto is written through Generali-U.S Branch (A).
The agency solicits risks in the entire state of California. Expansion is being researched and developed in AZ, NV, OR, TX and WA.
Atlantic Star Intermediaries, Inc., 390 N. Broadway, Jericho, NY 11753-2110; (516) 733-7400; fax (516) 681-7488 (Lynne Kensler). This underwriting manager specializes in general liability and umbrella coverage for all types of contractors. The firm has written most of the types of contractors mentioned in the above description of contractors. The firm focuses on heavy construction contractors. It writes joint ventures and owner and contractor-controlled wrap-ups also. Heavy contractors that have been written under this program include: street, road and highway construction, bridge construction, conduit contractors, railroad construction, utility construction, marine contractors, steel erectors, grading and paving construction, concrete construction, excavation and tunneling.
There are virtually no excluded risks because each risk is based on its own merits. Limits for contractors equipment/property/builders risk coverage range up to $150 million.
The firm writes in all states, Puerto Rico and Hawaii. General liability is written by Gerling America (A-VIII) and Commercial Underwriters Insurance Co. (A-X). Gerling writes the property package in conjunction with the general liability. The firm uses many umbrella companies with TIG and Gerling America being the feature markets.
Burns & Wilcox Ltd., 30833 Northwestern Hwy., Ste. 220, Farmington Hills, MI 48334; (248) 932-9000; (800) 521-1918; fax (248) 932-9046 (Steve Allen, senior vice president). This national underwriting manager and specialty broker offers coverage for all types of contractors. Few markets are available for the residential general contractors in California.
Liability limits are $1 million/$2 million/$1 million plus $10 million excess or umbrella. For property and inland marine (contractors equipment floaters), there is no maximum on limits available depending on area of country (some restrictions on wind and earthquake in certain areas). The firm serves agents in all states except AK, HI, ME and NY. Various underwriters are used; all rated A- or better.
ECS Underwriting (Environmental Compliance Services Inc.), 520 Eagleview Blvd, P.O. Box 636, Exton, PA 19341-0636; (610) 458-0570; (800) 327-1414; fax (610) 458-8667; Web site: www.ecsunderwriting.com (Christine Weirsky). ECS Underwriting's Construction Business Unit provides insurance to a variety of contractors including general, street and road, utility, industrial plumbing, rigging, mechanical, electrical, civil, drilling/geotechnical, paving, renovation, demolition, excavation/grading.
Coverages available include: commercial auto liability and physical damage, commercial general liability, general contractor's contingent professional and environmental liability, general contractor's pollution legal liability, pollution and remediation legal liability, property and inland marine, umbrella liability and workers compensation.
For commercial auto, coverage limits are up to $10 million. The policy includes sudden and accidental pollution coverage and attachment of the MCS-90 endorsement. Limits of liability for commercial general liability are $40 million occurrence/aggregate in-house for claims-made coverage and $5 million per occurrence/aggregate for occurrence coverage. Umbrella limits are $10 million in-house with higher limits available. Minimum underlying limits are $1 million/$2 million/$2 million products aggregate. Workers compensation limits are established by statute. Employers liability is included with limits of $500,000.
Limits for pollution legal liability are $40 million per loss/aggregate. Limits for property and business interruption are $10 million, with $1 million for pollutant and contamination cleanup. Inland marine limits are $10 million.
Policies are available on a brokerage basis in all states. Coverage is underwritten by Reliance National Insurance Co.
Excess & Surplus Lines Insurance Brokers, Inc., 13848 Ventura Blvd., Ste. A., Sherman Oaks, CA 91423; (818) 990-8860; fax (818) 990-4580 (Wayne E. Bernstein, director of marketing). This excess and surplus lines broker provides insurance for artisans, general contractors, roofers and environmental contractors. The firm serves agents in California only. Property and contractors equipment floaters are available. Underwriters include: First Financial, United Capitol, Reliance, Navigators, Century Surety, NIC Insurance and Preferred National.
FIRM, Inc., 385 Clinton Ave., Wyckoff, NJ 07481; (201) 891-8222; fax (201) 891-7931 (Stephen K. Bommer). This excess and surplus lines broker has a program sponsored by the Steel Erectors Association of America open to qualified risks: erectors of structural steel, steel joists, prefabricated buildings or siding, metal stairs and ornamental iron, precast concrete--structural and architectural, and metal decking; fabricators of structural steel, steel joists, metal decking, reinforcing wire/mesh, prefab/precast building, and miscellaneous ornamental iron works; crane sales, wire rope, slings, accessories, equipment, tools and fasteners; crane and equipment rentals, certified welding, millwrights, heavy equipment moving and rigging, and shear stud installation.
General liability limits are available to $1 million/$2 million. Included in coverage is sudden and accidental pollution for hydraulic spills. On-hook riggers liability is a separate policy with $1 million limit. Property, inland marine and equipment coverage is available. Auto coverage and workers compensation included with incidental USL&H coverage are also available. Railroad protective liability and umbrella limits to $5 million or $10 million.
Coverage is available in all states. The SEAA program is written by four regional brokers throughout the U. S.
Hanover Excess & Surplus, Inc., P.O. Box 1411, Wilmington, NC 28402; (800) 672-9006; fax (800) 426-5566 (David L. Parker, vice president). This excess and surplus lines broker provides various markets for contractor-related risks. Types of contractors included are general and paper contractors, subcontractors. Coverage is available under pre-established programs for roofers, artisan contractors, landscapers, swimming pool contractors, electrical and plumbing contractors, excavation contractors and contractors equipment rentals.
Limits are established on a risk-by-risk basis. Policies are available in North Carolina, South Carolina and Virginia. Markets used are Scottsdale, Acceptance, Colonia, Jefferson and Preferred National.
Independent Insurance Wholesalers, Inc., 722 S.W 2nd Ave., Ste. 340, Portland, OR 97204; (503) 224-1956; fax (503) 224-3010; e-mail: iiw@iww.com (Bob Stahl, president). This specialty broker writes insurance for environmental contractors, oil/gas contractors, paper contractors, general contractors, roofers. Liability and property coverages are available. Limits are available to $5 million or higher. Unlimited coverage for equipment floaters. Territory served is AK, CA, OR and WA. Underwriters include General Star, Admiral, Agricultural E&S, American Equity, Western World, Nautilus and AIG companies.
M. J. Kelly Co.,4415 E. Sunshine, P.O. Box 231, Springfield, MO 65809; (417) 883-2688; (800) 725-7211; fax (417) 883-7103 (Mike Kram). This excess and surplus lines broker specializes in the small to medium-sized contractor. Limits of liability run from $100,000 to $1 million with umbrellas available up to $100 million. The agency has several markets writing contractors equipment floaters, but excludes hand tools.
The firm operates in Arkansas, Florida, Kansas, Missouri, Oklahoma, Utah and Washington. Major carriers include Aegis, First Financial, Colony, Western World, Guaranty National, Lloyds. John Deere, Essex, Clarendon and American Equity.
Montgomery & Collins, Inc., 5 Forest Park Dr., Farmington, CT 06032-1475; (860) 674-3720; (800) 228-1072; fax (860) 674-3725 (Scott Polley, vice president). This underwriting manager writes a program targeting selected classes of specialty contractors. Types of contractors eligible are: grading, excavation, roofers, utility, plumbing, conduit, dry wall, electrical, pile driving, pipeline, marine, demolition, street and road, sewer, concrete, paving, mechanical and carpentry.
Policy limits for occurrence general liability are available to $1 million/$2 million/$1 million. Umbrella coverage is available up to $10 million in-house. Higher limits are available from other markets. Agents may access this program through any Montgomery & Collins office. The coverage is written by United National Insurance Co. in all states except AK, CA, HI and NJ.
National Environmental Coverage Corp., 747 Chestnut Ridge Rd., Ste. 305, Chestnut Ridge, NY 10977; (914) 425-2333; (800) 552-0230; fax (914) 425-2853; Web site: www.necc.com (Chris Holmes, president). This underwriting manager writes occurrence and claims-made commercial general liability coverage for the following types of contractors: blasting, bridge, crane, demolition, drilling, shoring, equipment rental, under pinning, tunneling and caisson. It also has programs for asbestos abatement, lead abatement, underground storage tank removers and environmental contractors.
Limits are available to $10 million or higher. The coverage is available in all states. Underwriters are various A-rated companies.
Regis Insurance Co., 1031 Old Cassatt Rd., Ste. 201, Berwyn, PA 19312-1151; (800) 355-1280; fax (610) 647-4630 (Joe Burrows, marketing director). This insurer writes tree trimmers, landscaping, residential roofing and siding contractors. The program excludes commercial roofers.
Property and liability limits are available to $1 million per occurrence/$2 million aggregate. Coverage is available in the following states: AL, DE, DC, FL, GA, IL, IN, KY, MD, MA, NC, OH, PA, TN and WV.
Sherwood Insurance Services, 201 California St., Ste. 1000, San Francisco, CA 94111; (415) 956-3236; fax (415) 956-1204 (Phil Mazur or Jim Barnes). This specialty general agent writes all types of contractors: residential, commercial, general, artisans, roofers, crane and rigging and wrap-ups.
Primary, excess and umbrella limits are available. The policies are available in all states and in other countries. Various underwriters are represented including: AIG, Admiral, American Dynasty, Agricultural, American Equity, American National, Century Surety, Chubb Custom, Clarendon, Gerling, Kemper, Legion, Mt Hawley (RLI), Markel (Essex), Monticello, Pacific, Reliance, Royal, Scottsdale, Steadfast, TIG, Tamarack, Tudor, United Coastal, United Capital and Westchester.
Stewart Smith West, Inc., 550 N. Brand Blvd., Ste. 250, Glendale, CA 91203; (818) 265-1959; fax (818) 265-0841. This specialty E&S broker writes both general and subcontractors under separate programs. Limits are available for CGL up to $5 million each occurrence/$5 million general aggregate per location/project/$5 million products aggregate. There is a limit of $5 million each claim for the employee benefit liability and $1 million for non-owned and hired auto coverage. The subcontractors program also provides general liability and non-owned and hired auto coverage. Excluded classes in the subcontractors program include: residential graders in California and wood based roofing.
Programs are underwritten by Legion Insurance/Indemnity Co. (Rated A-VIII). The program is offered in all states through any Stewart Smith office.
Surplex Underwriters, Inc., P. O. Box 998, Portland, ME 04104; (207) 856-0261; (800) 441-1799; fax (207) 856-0260 (Denise Joy). This managing general agency writes the following types of contracting risks: roofers, including hot tar, welders, excavation, artisans, general and paper contractors and environmental contractors.
Limits for general liability are $1 million/$2 million or higher; property coverage is available to $1 million in-house; higher limits available. Umbrellas and excess liability and commercial auto coverages are also available.
Territory covered is CT, ME, MA, NH, RI and VT. Coverage is accessed through the firm's principal office and affiliates in Bedford, NH; Warwick, RI; and Weymouth, MA. Underwriters include Penn-America, United National, American Equity, Nautilus, Great American and First State.
Travelers Property Casualty Cos., One Tower Sq., Hartford, CT 06183; (860) 277-7329; fax (860) 277-7301 (Steve Senott, director, construction division). This insurer provides insurance for all areas of construction, except artisan or smaller trade contractors. The latter classes are available through the Select Accounts Department. General liability, property, auto, workers compensation, and umbrella coverages are written. The company writes in all states.
U. S. Risk Underwriters, Inc., Environmental Division, 925-B Capital of Texas Hwy. S., Ste. 235, Austin, TX 78746; (512) 328-3888; (800) 926-9155; (512) 328-9710 (Greg Johnson, director of underwriting). This excess and surplus lines broker writes a program for contractors professional and pollution liability insurance.
The following classes are written: general contractors--design using in-house architects, engineers or design professionals; design using out-of-house design professionals; construction managers and overall project management.
Specialty contractors, such as mechanical, electrical, plumbing, road and bridge, paving, concrete, painting, excavation and tunneling, building, demolition, utility, drilling, and landscape/irrigation with in-house or-out-of house design capabilities.
Environmental contractors with in-house or out-of-house design capabilities, including asbestos and lead abatement, remediation (soil, surface water and ground water), emergency response, indoor air quality, and UST/AST removal and installation.
Limits available are up to $5 million/$5 million. Coverage is available in all states. Underwriter is Zurich Re (U.K.)(A- rated).
Whitcomb Insurance Services, 109 W. Torrance Blvd., P.O. Box 7000-919, Redondo Beach, CA 90277; (310) 798-6212; fax (310) 374-8171 (Rudolph Whitcomb, president). This surplus lines broker targets large contractors of all classes, doing residential, commercial and infrastructure construction, both on and offshore. The firm writes general liability and excess/umbrella coverages. It also has markets for equipment floater/property and auto insurance. The office uses various underwriters and operates
worldwide. *
©COPYRIGHT: The Rough Notes Magazine, 1998